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USA PayPal -new 500$ limit
 

What will happen now after the new laws? they will report all transactions over 500$ to the IRS? will IRS always send letters for collections at the end of the year? or they will just do it when they want to "audit" or "deep audit " someone?

Re: USA PayPal -new 500$ limit
 

It's $600.

The difference will be that you won't be able to use USA Paypals at all without giving a tax ID + the reportable threshold will drop from $20,000/200 to $600. eBay just released an announcement about it.

Re: USA PayPal -new 500$ limit
 

And what will work ? because if a friend and his wife put their SSNs on my accounts, surely they will be upset if he get a letter from IRS... for 18 000 sales/year each ...

Re: USA PayPal -new 500$ limit
 

Use an EIN and report the $ yourself.

The exact reason they've made this a law is to catch those who've been staying under the radar by running 190 transactions through 20 different Paypal's each year. There is no way around this aside from just not using American accounts.

Re: USA PayPal -new 500$ limit
 

paypal, ebay, mecari and Amazon are going to lose billions. I'm surprised they didn't fight harder against this rule.

I think this will only motivate sellers to cheat a lot more on their taxes.

Re: USA PayPal -new 500$ limit
 

THey'll send 1099 after $600.

So better get your accountant figure out how much tax $ you'll owe.
It does catch up quick FYI

Re: USA PayPal -new 500$ limit
 

Well considering paypal is out of the picture as far as ebay goes and considering ebay already requries the SSN in order enroll properly in MP this wont have much of an impact on US users.
If youre doing things the proper way and reporting your taxes this doesnt make a difference to your operation one way or another.

Re: USA PayPal -new 500$ limit
 

Hi, I've been running a personal account under my real name (but no SSN or ITIN because I'm not American). I called the IRS and obtained an EIN for a completely different reason unrelated to PayPal, same matching name and all.

I don't make nowhere near 20,000, but certainly more than 600. If/when they ask me for a Tax ID can I provide this EIN to comply with that and then just do the whole $ reporting myself?

Re: USA PayPal -new 500$ limit
 

Talk to a professional - I'm no expert. I try but I don't want to mislead you and be wrong about something.

If you're under $20,000 and 200 transaction for this year there won't be a 1099 made unless your account is registered in one of the few states that mandated lower thresholds a few years ago. Next year if you're over $600 (any # of transactions) you will have 1099 made.

I'm American so I have no idea how somebody outside the US would go about reporting income to American authorities. :noidea:

Re: USA PayPal -new 500$ limit
 

No they won't. Amazon is a behemoth who only grows and never shrinks - eBay has consistently had record profits since introducing promoted listings. They'll be fine.

What probably will happen though is smaller sellers who just sell things around their house will ignore this new requirement, causing the IRS to be overloaded with tons of new work. The IRS is already over worked and months behind on everything, so this should be interesting. :ranger:

Re: USA PayPal -new 500$ limit
 

ITIN :)

Non American citizens can also get EINs

Re: USA PayPal -new 500$ limit
 

Yeah, but then what... :lol:

Re: USA PayPal -new 500$ limit
 

Foreign sellers selling in US ,will collect sales tax and remit to buyer state,which Ebay /AMZN/Etsy are doing for you.
But for income tax,it goes by Social security number which you dont have,so there is no way US govt/IRS knows you are making money on US soil ,unless the sales venue report you?but I am not aware of anyone doing so.
try asking on Ebay seller forum,

Re: USA PayPal -new 500$ limit
 

I know foreigner who bought and sold US bonds,stocks and real estate would pay tax to Federal govt for any capital gains,how does it know?
IRS has access to such activities.